Which is Better, Renting or Owning a Home?
Comparison Between Renting a House and Owning a Home
|
Renting a House |
Owning a Home |
| No associated pride in renting from someone else due to the lack of a certain degree of privacy | There is the pride of being a homeowner and right to privacy |
| Influences in no way ones credit score value | Helps in building a good credit score |
| A tenant renting a house from a landlord isn’t subjected to the payment of the loan procured for the purchase or the construction of the house | The homeowner is required to pay back the loan(s) incurred for the purchase or construction of the home unless it was paid for or funded fully by the owner |
| The tenant isn’t subjected to the payment of any other tax pertaining to the house such as property tax | The homeowner is subjected to the payment of taxes such as property tax |
| A tenant has access to the house only during the lease period | A homeowner is the owner of the home for as long as they want |
| There is the uncertainty of terms and conditions during the renewal of the lease in the form of rent increment or asked to vacate the premises | No need for any lease renewal or revision of the terms and condition, relocation difficulties since the house belongs to the homeowner |
| Relocation of the tenant bring about certain incumbent cost and difficulties such as cost, security deposits, telephone and mail redirecting etc. | |
| The tenant doesn’t have the right to remodel or make modifications to the house and in some cases even pets are not accepted within the premises | Remodelling and modifying the internal and external structure/view of the house and the institution of any rules and regulation is the prerogative of the homeowner |
| Renting a house is cheaper than owning or buying a house because it is usually done on a monthly basis that is the rents are usually lower in cost | It takes a substantial amount of money to become a homeowner. This is very difficult to achieve without loaning or borrowing from financial institutions. |
| In the long run the cumulative amount paid as rents after a couple of years tends to be more expensive than owning a home | There is a great financial benefit for not paying rents and being a homeowner in the long run |
| Renting a house gives the tenant more mobility and flexibility. How long you reside in a location is determined by the contract signed which can be short termed or long termed ranging from a couple of months to years. A tenant could easily leave a rented house or apartment to another if the former is not pleased with the place and wants to change | Owning a home isn’t as flexible as being a tenant. The procedure for the homeowner to change homes is expensive and long. A homeowner has limited mobility (usually in years) as compared to the tenant due to the liabilities involved unless the homeowner sells or rents the home. |
| The financial risk involved in renting a house significantly lower than that envisaged via home ownership. The tenant only stands to lose the security deposit which is usually about 4 weeks’ worth of rents or an increment in the house rents | The financial risk involved in purchasing and owning a home is more significant to the owner than someone renting. The loaning, taxing and mortgaging engagement see to this |
| The monthly expenditure on rents is constant throughout the renting period | The monthly expenditure on the home may vary depending on various factors such as fluctuations in interest rates |
| There is a possibility for the tenants to save and invest from their monthly income after the monthly rents have been paid | The homeowner usually ends up in debts from loans and mortgages related to the acquisition or construction of the home |
| The tenant has the responsibility of paying for the rents and utility costs such as gas, cable, telephone, electricity etc. | The landlord has the responsibility for repairs and maintenance of the house is that of the landlord. The homeowner equally pays for the interest rates and taxes |
| The tenant sometimes suffers from having a reluctant or lazy landlord, who may be slow in the conduct of repairs and maintenance around the house | The homeowner living in their residence has the obligation to repair and maintain home in a timely fashion since they and their family are those to suffer |
| The tenants have no advantage with respect to equity gains from the renting of a house for the landlord | The landlord benefits from the rents paid and is considered as a steady source of income. Nonetheless, a homeowner who lives in his/her residence doesn’t pay rents |
Deciding which option is better i.e. being a homeowner or a tenant, one has to weigh the pros and cons of each aspect and likening it to their present physical and financial status. Owning a home comes with a lot of responsibility and demands that one has a stable or growing income. Renting is a good option if one cannot yet afford to purchase a home or is still clinging to the freedom and flexibility that comes with being a tenant.
